Avoiding HR automation, is it the right approach?
The Indian business scenario is changing. The work culture is becoming more and more competitive, strategic and fierce. Several great minds from IITs, IIMs, and other reputed institutions in India are working towards strategizing and bringing their businesses to the top. More and more companies are automating HR processes. On one hand, big companies believe that automation of HR process is a key factor that will help manage resource and track cost distribution; on the other, the mid-size and small companies are still reluctant to adopt the implementation.
Why HR Automation is ignored and considered irrelevant?
Several mid-size/small companies lay less or negligible focus on HR as a department. The fund flow is scarce or limited; hence these companies prefer to invest in the business by concentrating on sectors such as marketing, sales, product/ services promotion, product / services creation, etc.
Consider this situation: There is a small-size company with about 150 full-time employees. The organisation has managed to establish fairly strong teams for the above mentioned departments. As far as the HR function is concerned, they hire a HR personnel, who comes with a few years of industry experience and is backed by couple of relevant/ impressive qualifications. The HR resource is expected to manage the A-Z of HR processes of employees; which he/she does well.
The business grows and teams expand; more employees are hired. The organisation is now focusing on maximizing its revenues and gaining market share. With increased number of employees, the hygiene and routine work gets exhaustive. The management decides to hire another HR expert or perhaps two believing this development will help save cost and bring process efficiency. This HR team is considered as more efficient and less expensive as compared to implementing an automated system. Is it more effective? The second or third member in the HR team is hired usually with an intention to avoid bringing in automation. In such cases, is the replacement justified?
From an organization’s point of view, automating its processes is justified when its ROI (return on investment) exceeds the investments, irrespective of departments. HR is no exception. The management would prefer implementing automation for other functions but ignore HR, in this case.
In short, they consider HR as a support function and not a strategic business function.
Is it the right approach?
We cannot deny the fact that calculating ROI on HR automation can be difficult. However, one cannot undervalue the benefits of automation. Moreover, most companies are comfortable with the traditional methods (e.g.: spreadsheets, manual data entry, etc) that they have been following since ages and are least interested in implementing changes.
The above organisation will further expand and hire more employees; in that case, will the management keep adding to the number of HR personnel? Wouldn’t automation be more efficient option? Beyond a point, all organizations have to embrace automation to cut down excessive overheads incurred in the process. By adopting this software driven process, most of the employee-related work becomes automated in addition to being accurate and precise. This step leaves HR officials with more time to strategize and come up with more plans, trainings, workshops and concentrate more focus to employees. On a micro level, HR Automation directly impacts performance and productivity of the employee; whereas on a macro level, its benefits the organisation.